You have the right version of Fusion. Believe the error message.

You are trying to run a virtual machine that requires an Intel CPU - perhaps one that was moved to your M1 Mac from an Intel Mac or PC. The M1 chip is not an Intel chip, so Fusion is incapable of running any virtual machine whose operating system requires an Intel CPU.

Fusion on M1/M2 Macs can only run operating systems built for ARM CPUs. For Windows users, that means you must run Windows 11 ARM. No other version of Windows will work.

(and no, Rosetta 2 won't make it work. It's a documented Apple restriction that Rosetta can not be used by software like Fusion or Parallels to virtualize Intel operating systems).

You may want to take a look at the Unofficial Fusion 13 for Apple Silicon Companion Guide, which goes into more details on the operating systems that run on M1/M2 Macs.